Do you need a loan for your business? If YES, here is a detailed sample SBA loan business plan template & proposal for a biodegradable plastic bag company.

A Sample SBA Loan Business Plan Template for Green Zone® Biodegradable Plastic Bags Manufacturing Co

Executive Summary and Company Description

Green Zone® Biodegradable Plastic Bags Manufacturing Co is a US registered biodegradable plastic business that will be located in Concord – New Hampshire; in a location that is highly suitable for the kind of business we want to establish. We have been able to lease a facility that is big enough (a 10 thousand square foot facility) to fit into the kind of biodegradable plastic bag manufacturing company that we intend establishing.

Green Zone® Biodegradable Plastic Bags Manufacturing Co will be involved in the manufacturing of a wide range of biodegradable plastic bags for both corporate and individual clients. We are set to service a wide range of clientele not just in the United States of America, but also all parts of the world.

We are aware that there are several biodegradable plastic bag manufacturing companies all around the United States of America, which is why we spent time and resources to conduct a thorough feasibility studies and market survey so as to favorably compete with our competitors.

Green Zone® Biodegradable Plastic Bags Manufacturing Co will ensure that all the plastic bags that leave factory are of the highest quality, highly durable and affordable. We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they may grow to.

Green Zone® Biodegradable Plastic Bags Manufacturing Co will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible. We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely whenever they patronize our products.

Green Zone® Biodegradable Plastic Bags Manufacturing Co is a family business that is owned by Eric Moore and his immediate family members. Eric Moore has B.Engr. in Production Engineering, with over 12 years’ experience in the bioplastic manufacturing industry in the United States.

Our Products and Services

  • Customized biodegradable plastic bags for events
  • Biodegradable plastic bags for food storage bags
  • Biodegradable plastic bags for grocery bags
  • Biodegradable plastic bags for merchandise bags
  • Biodegradable plastic bags for trash bags
  • Biodegradable plastic bags for packaging

Economics

Facts About the Bioplastics Manufacturing industry:

If you follow of happenings in the Bioplastics Manufacturing industry, you will notice that the industry experienced steady growth over the five years to 2018. Concerns over the future of petroleum-based plastics supported demand for bioplastics that are recyclable and sustainable.

Furthermore, volatility in the world price of crude oil influenced major plastics producers to search for an alternative. Rising environmental awareness during the period encouraged the government and large companies to promote the use of bioplastics, directly benefiting the industry.

The industry is still in its early stages, leading to high expenditure on research and development. Over the five years to 2023, IBISWorld expects that a strong economic environment, expansion into new markets and positive legislation will benefit demand for industry products

The revenue generated in the industry is heavily influenced by national demand for consumer goods, as the majority of the products that are produced in the industry are sold for downstream use in the fast-moving consumer goods (FMCG) sector.

The Bioplastic Manufacturing industry is indeed a major sector of the economy of most developed countries in the world. Statistics has it that in the United States of America, the Bioplastic Manufacturing industry generates over $469 million annually from more than 124 registered and licensed biodegradable plastic bags manufacturing companies.

The industry is responsible for the employment of over 529 people. Experts project the industry to grow at a 4.5 percent annual rate within 2013 and 2018. The establishment in this industry that has a dominant market share in the United States of America is NatureWorks.

A recent report published by IBISWorld shows that the Bioplastics Manufacturing industry is in the growth phase of its economic life cycle. The report also stated that the industry is expected to introduce new products, reach new markets and experience an influx of new participants.

The industry’s contribution to the overall economy, as measured by industry value added (IVA), is forecast to grow at an annualized rate of 2.0 percent during the 10-year period to 2023. During the same period, US GDP is expected to grow at an annualized rate of 2.2 percent. This indicates that the Bioplastics Manufacturing industry is expected to grow near the same rate as the US economy

Growth Potential and Opportunity for a Business of our Size

The growth potential for a business of our size with a mid-scale production facility is massive because aside from legislation that supports going green in all industry, we are well positioned in a city with loads of retailers and of course a city whose economy is fueled by the retail industry.

The barriers to entry we will face in entering this market with our new company are:

  • High capital costs
  • High production costs
  • High marketing costs
  • Consumer acceptance and brand recognition
  • Attracting and retaining welled trained and skilled professionals
  • Shipping costs
  • Tariff barriers and quotas

We will overcome the barriers listed above by consciously building capacity and reputation that will help us attract credit facilities and also attract qualified employees that will help us drive the business to profitability with the shortest time frame possible.

Threats and Challenges

The factors that can affect our company are sudden change in technology, change in government regulations, change in the economy dynamics of our State and the United States and lastly change in our industry regulations and approaches.

Our Competitive Advantage

A close examination of the bioplastic manufacturing industry reveals that the market has become much more intensely competitive over the last decade. As a matter of fact, you have to be highly creative with your designs and market approach, customer centric and proactive if you must survive in this industry.

We are aware of the stiff competition and we are prepared to compete favorably with other leading biodegradable plastic bag manufacturing companies in the United States.

Our biodegradable plastic bag manufacturing company is located in an ideal property highly suitable for the kind of manufacturing company that we want to run. We have enough parking space that can accommodate over 30 cars/trucks per time.

Our ability to negotiate successfully with regulators, optimum capacity utilization and superior financial management and debt management are part of the competitive advantages we will be bringing to the table.

One thing is certain, we will ensure that we manufacture high quality and durable biodegradable plastic bags in our factory at all times. One of our business goal is to make Green Zone® Biodegradable Plastic Bags Manufacturing Co a one stop biodegradable plastic bag manufacturing company. Our excellent customer service culture, various payment options and highly secured facility will serve as a competitive advantage for us.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category (startups biodegradable plastic bag manufacturing companies) in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and objectives. We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

  • Market Trends

One major trend in the bioplastic manufacturing industry is that most players are leveraging on the fact that states in the US and even countries of the world are passing legislation that will limit the use of polythene bags because of environmental hazard hence biodegradable plastic bags have become a good substitute.

The growing pollution from petroleum-based plastics bags and similar products is negatively affecting the environment and it is a worldwide concern that is responsible for the demand for bags and packaging materials made from biodegradable plastics.

The increasing dependence of the medical and food industry on environmental-friendly plastic packaging is a notable factor catalyzing the market demand for biodegradable plastics bags. The intensifying regulations associated to the disposal of traditional plastics in different developed and developing countries is a top factor drawing attention to the industry demand for these bags and plastics.

Extensive advances made in manufacturing technologies and the use of a variety of additive materials are likely to improve the biodegradability of these plastic sacks and bags, thereby unlocking exciting avenues during the assessment period.

As part of marketing strategies, biodegradable plastic bag manufacturing companies now ensure that they go beyond mass production of biodegradable plastic bags to producing customized biodegradable plastic bags for bigger corporations who are in the fast-moving consumer goods (FMCG) sector.

SBA Loan Business Plan – Marketing Plan

  • Our Market Goals

Our marketing goal as a biodegradable plastic bag manufacturing company as clearly stated in our business plan is to build a standard and world class biodegradable plastic bag manufacturing company that will favorably compete with leaders in the industry.

We want to build a business whose brands will someday become a household name not only in the United States of America but also in South America, Caribbean and Africa. In view of that, we are set out to achieve the following market goals:

  • Sell a minimum of 5000 Biodegradable Plastic bags Per Day
  • Make a monthly sale of our biodegradable plastic bags to about $20,000 and about $240,000 for the first year and double the amount for the second year and the possibility to keep doubling our annual sale going forward.
  • Increase the number of our wholesalers and distributors by 5 percent quarterly
  • Generate 50 percent of sales from exporting our biodegradable plastic bags to Africa (20 percent), Caribbean (20 percent) and South America (20 percent)

What we aim to achieve from our market efforts are as follows:

  • To be able to compete favorably with NatureWorks which is the leading biodegradable plastic bag manufacturing brand in the United States of America
  • Build a self – sustaining business model that will run on auto – pilot and of course contribute towards the protection of the earth, the ozone layer and the growth of the economy of the United States of America.

Our Marketing Budget

The fact that our goal is to establish a biodegradable plastic bag manufacturing – brand that will compete favorably with leading brand like NatureWorks means that we should be willing to spend more on marketing our biodegradable plastic bags hence we have set aside a budget of 10,000 US dollars annually for marketing.

Going forward, we will budget between 5 percent and 10 percent of our annual income towards marketing and promoting our biodegradable plastic bag products. Please note that we are likely going to increase this budget when the need arises especially if we have to explore a more expensive marketing models and approaches.

Our Target Market

When it comes to selling biodegradable plastic bags, there is indeed a wide range of available customers. In essence, our target market can’t be restricted to just a retail stores, but all those who make use of plastic bags. In view of that, we will market our biodegradable plastic bags to the following customers;

  • Departmental Stores
  • Groceries Stores
  • Pharmaceutical Stores
  • Electronic Stores
  • Supermarkets
  • Boutiques
  • Shoe manufacturing companies
  • Fast food restaurants
  • Mobile phones and accessories stores

The Benefits Our Client Stand to Gain When They Patronize Our Biodegradable Plastic Bags

We are quite aware of the competition that exists in the bioplastics manufacturing industry in the United States of America, hence we conducted a thorough feasibility studies and market survey so as to enable us penetrate the market and also generate the required sales that will grow our business as projected in our business plan.

In view of that, here are the benefits our customers stand to benefit when they purchase our biodegradable plastic bags:

  • A product that is cheap and can comfortably contain the products or goods purchased
  • Durable and environmentally friendly biodegradable plastic bags that is safe and can be used by anyone
  • The best price / deal they can get per packet in the whole of the United States of America
  • Opportunity to choose from a wide range of different designs and sizes
  • Availability of money back policy for first – time customers who just want to try out our biodegradable plastic bags
  • Wide range of distribution network
  • Excellent customer service experience from our highly trained employees

What Makes Our Biodegradable Plastic Bags Superior to Our Competitions

We are quite aware of the competitions that exist amongst biodegradable plastic bag manufacturing companies in the United States of America which is why we have decided to craft out a unique selling strategy that will help us attract our target market.

The fact that our biodegradable plastic bags will come in good quality and in different designs and sizes with a far – reaching distribution network will definitely give us an edge in the market place. Another factor that will serve as a positive for us is that we will continue to work with our customers to make sure that our customer service delivery is top notch and we will also ensure that we offer our customers incentives.

As part of what we intend doing to outperformed our competitors and build a solid biodegradable plastic bag manufacturing, we will ensure that our production facility is designed and constructed in such a way that it will meet the expected standard required by the authority.

Creating Brand Identity for Our Biodegradable Plastic Bag Manufacturing Company

In promoting our brand and corporate identity, we will leverage on the print and electronic media. As a matter of fact, it is cost effective to use social media platforms to promote our brands, besides it is pretty much effective. Here are the ways we intend creating brand identity of our biodegradable plastic bag company

  • Design a unique corporate logo
  • Place adverts on both print and electronic media platforms
  • Ensure that our workers wear our branded shirts at all times during working hours and also, we will brand all our distribution vans, trucks and cars et al.
  • Place our flexi banners with our company’s logo and contacts in strategic positions
  • Sponsor relevant TV programs, Radio programs and community – based programs
  • Maximize our company’s website to promote our products
  • Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, LinkedIn, Snap Chat, Google+, Pinterest and other platforms to promote our corporate brand
  • Install our Bill Boards in strategic locations
  • Distribute our fliers and handbills in targeted areas where we can easily reach out to the fast-moving consumer goods (FMCG) sector from time to time

Our Retention Strategies (Ways to Improve Our Customer Experience)

We have perfected plans on how to improve our customer experience whenever they purchase our biodegradable plastic bags. These are the ways we intend utilizing when it comes to improving our customer experience so that we can create a good impression:

  • Ensures that our biodegradable plastic bags are durable
  • Ensure we get feedbacks from our customers at all times
  • Give our customers the flexibility to choose from a wide range of different designs and sizes of pocket friendly biodegradable plastic bags.
  • Give our customers the options to order in bulk (wholesale) from our online portal and get them delivered in any location of their choice within the area that we cover
  • Make use of effective customer relationship management (CRM) software to effectively manage our clientele base.
  • Ensures that we carry our clients along when making decisions that will directly affect them.

The Ways We Intend to Promote Our Biodegradable Plastic Bags without Using the Internet

Here are the platforms we intend leveraging on when it comes to advertising and promoting our biodegradable plastic bags in the market place;

  • Place adverts on national TV, Radio Stations and Newspapers/Magazines
  • Sponsor relevant community programs
  • Encourage the use of word of mouth from satisfied customers
  • Install our Bill Boards in strategic locations
  • List our biodegradable plastic bag company and products on yellow pages
  • Distribute our fliers and handbills to targeted areas from time to time
  • Ensures that our workers and distributors wear our branded shirts at all times during working hours.

The Ways We Intend to Promote Our Biodegradable Plastic Bag on the Internet

Here are ways we intending leveraging on the internet to promote our biodegradable plastic bags:

  • Leverage on social media platforms such as; Instagram, Facebook, Pinterest, Snap chat, YouTube, Twitter, and Google + et al
  • Make use of mobile apps to promote our biodegradable plastic bags
  • Design an interactive corporate website and use the platform to promote our biodegradable plastic bags
  • Place adverts on high traffic websites
  • Post sponsored articles on high traffic blogs
  • Engage in blogging and make use of the platform to promote our biodegradable plastic bags
  • Leverage on email marketing strategy to advertise and promote our biodegradable plastic bags.

The Possible Ways We Intend Offering Incentives to Our Customers (Bonus, Discounts, etc.)

Part of our marketing strategies which is clearly stated in our business plan is to ensure that we offer our customers incentives in order for us to retain them and also to attract new customers.

In view of that, we will ensure that we sell our biodegradable plastic bags a little bit below the average price in the industry while. We will regularly give discounts to our customers based on the total amount of biodegradable plastic bags they purchase from us any time they visit our distribution outlets.

We will create a loyalty plan that will enable us reward our loyal customers especially those who help us to successfully market our biodegradable plastic bags to their family members, friends and colleagues. Rewarding them could be giving them discounts on every purchase they make and also giving them gifts during special occasions.

SBA Loan Business Plan – Operational Plan

We will ensure that we maximize our production facility since all our equipment and machines are still new hence our planned production levels will be around 95 – 98 percent for the first 6 months.

Our purchasing and inventory management procedures will be based on international best practices which will facilitate easy flow of raw materials to our production plant and easy flow of finished products (biodegradable plastic bags) from our factory to the market.

Management & Organization

Below is our management and organizational structure. Please note that this excludes unskilled laborers who we will engage from time to time;

  • Chief Executive Officer (Owner)
  • Factory Manager
  • Human Resources and Amin Manager
  • Merchandize Manager
  • Sales and Marketing Manager
  • Biodegradable Plastic Bags Designers and Makers
  • Accountants / Cashiers
  • Customer Services Executive

Roles and Responsibilities

Chief Executive Officer – CEO:

  • Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities
  • Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
  • Responsible for fixing prices and signing business deals
  • Responsible for providing direction for the business
  • Responsible for signing checks and documents on behalf of the company
  • Evaluates the success of the organization

Admin and HR Manager

  • Responsible for overseeing the smooth running of HR and administrative tasks for the organization
  • Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
  • Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
  • Defines job positions for recruitment and managing interviewing process
  • Carries out induction for new team members
  • Responsible for training, evaluation and assessment of employees
  • Responsible for arranging travel, meetings and appointments
  • Oversees the smooth running of the daily office activities.

Factory Manager:

  • Responsible for managing the daily activities in the biodegradable plastic bag manufacturing factory
  • Ensures that proper records are kept and warehouse does not run out of finished products
  • Ensures that the factory is in tip top shape and easy to locate
  • Interfaces with third – party suppliers of raw materials
  • Controls biodegradable plastic bag distribution and supply inventory
  • Supervises the workforce in the biodegradable plastic bag manufacturing factory.

Merchandize Manager

  • Manages vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
  • Helps to ensure quality raw materials are purchased and used
  • Responsible for the purchase of biodegradable plastic bag raw material for the organizations
  • Responsible for planning sales, monitoring inventory, selecting the merchandise, and writing and pricing orders to vendors
  • Ensures that the organization operates within stipulated budget.

Sales and Marketing Manager

  • Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
  • Models demographic information and analyze the volumes of transactional data generated by customer purchases
  • Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
  • Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
  • Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
  • Documents all customer contact and information
  • Represents the company in strategic meetings
  • Helps increase sales and growth for the company

Biodegradable Plastic Bag Designers

  • Responsible for designing and manufacturing customized biodegradable plastic bags

Accountant / Cashier:

  • Responsible for preparing financial reports, budgets, and financial statements for the organization
  • Provides managements with financial analyses, development budgets, and accounting reports
  • Responsible for financial forecasting and risks analysis.
  • Performs cash management, general ledger accounting, and financial reporting
  • Responsible for developing and managing financial systems and policies
  • Responsible for administering payrolls
  • Ensures compliance with taxation legislation
  • Handles all financial transactions for the organization
  • Serves as internal auditor for the organization

Client Service Executive

  • Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
  • Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
  • Manages administrative duties assigned by the human resources and admin manager in an effective and timely manner
  • Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries

Professional and Advisory Support

Board of Directors

  • Eric Moore – Chairman
  • Isabella Moore – Director
  • Gerald Moore – Director
  • James Dennis – Director
  • Dave Finn – Director
  • Edison Lawson – Secretary

Management Advisory Board

  • Michael Haggar
  • Julie Rowland
  • Sally Jones

Attorney – Bar. Garry West (LLB, LLM)

Accountant – Jordan Brown

Insurance agent – Alliance Insurance Group

Banker – Platform™ Investment Bank, Inc.

Legal Environment

We are able to secure the needed legal framework for a business such as ours and they are;

  • Licensing and bonding requirements
  • Permits
  • Health, workplace, or environmental regulations
  • Special regulations covering our industry
  • Zoning or building code requirements
  • Insurance coverage
  • Trademarks, copyrights, or patents (pending, existing, or purchased)

Startup Expenses and Capitalization

Startup Expenses

These are the key areas where we will spend our startup capital on;

  • The total fee for registering the Business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $3,300.
  • Marketing expenses for the grand opening of Green Zone® Biodegradable Plastic Bags Manufacturing Co in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The total cost for hiring Business Consultant – $2,500.
  • The total cost of payment of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $9,400.
  • The total cost for long – term leasing of a standard warehouse / factory – $150,000
  • The total cost for remodeling the factory – $20,000.
  • Other start-up expenses including stationery ($500) and phone and utility deposits – ($2,500).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
  • The total cost for start-up inventory (purchase of tools and equipment and the purchase of raw materials inclusive) – $150,000
  • The total cost for counter area equipment – $9,500
  • The total cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The total cost for the purchase and installation of CCTVs: $10,000
  • The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al): $4,000.
  • The total cost of launching a Website: $600
  • The total cost for our opening party: $7,000
  • Miscellaneous: $10,000

We would need to spend an estimate of $550,000 to successfully set up our biodegradable plastic bag manufacturing company.

Capitalization

These are the areas we intend generating our startup capital;

  • Generate part of the startup capital from personal savings
  • Source for soft loans from family members and friends
  • Apply for loan from the bank

N.B: We will generate about $150,000 (Personal savings $100,000 and soft loan from family members $50,000) and we are applying for a loan of $400,000 from our bank (SBA).

Distribution Channels

We will maximize all the available distribution channels within our disposal to get our products to our customers hence we will retail from our showroom to individuals and we also engage distributors and businesses who have the capacity to purchase in wholesale from our warehouses. We will engage our own sales team and freelance sales agents (independent representatives) and distributors to be able to achieve this.

Sales Forecast

Based on available data, these are the sales forecast we were able to come up with;

  • First Fiscal Year (FY1): $250,000
  • Second Fiscal Year (FY2): $650,000
  • Third Fiscal Year (FY3): $1.2 million

Our Pricing Strategy

Aside from quality, pricing is one of the key factors that gives leverage to biodegradable plastic bag manufacturing companies. It is normal for consumers to go to places where they can get biodegradable plastic bags at cheaper prices which is why big players like NatureWorks will always attract loads of clients.

We know we don’t have the capacity to compete with NatureWorks but we will ensure that the prices and quality of all our biodegradable plastic bags are competitive with what is obtainable in companies within our level.

  • Payment Options

The payment policy adopted by Green Zone® Biodegradable Plastic Bags Manufacturing Co is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Green Zone® Biodegradable Plastic Bags Manufacturing Co will make available to her clients;

  • Payment via bank transfer
  • Payment with cash
  • Payment via Point of Sale Machine (POS)
  • Payment via online bank transfer
  • Payment via check
  • Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our clients make payment for the purchase of our bags without any stress on their part. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash or make online transfers.

  • Our Credit Policies

Because we will be engaging merchants and wholesale distributors, we have put plan in place to sell on credit because it customary in our industry and expected by our clientele.

We will only give credit facilities to distributors who have been with us for three months and we can only extend 30 percent of credit of the whole goods purchased for the first year and extend it to 60 percent subsequently and for some customers who have high credit ratings, we can give up to 80 percent credit facility. We are aware of the cost implication of giving out credit facilities and we have built the costs into our pricing system.

Appendices

Include details and studies used in your business plan; for example:

  • Brochures and advertising materials
  • Industry studies
  • Blueprints and plans
  • Maps and photos of location
  • Magazine or other articles
  • Detailed lists of equipment owned or to be purchased
  • Copies of leases and contracts
  • Letters of support from future customers
  • Any other materials needed to support the assumptions in this plan
  • Market research studies
  • List of assets available as collateral for a loan

Solomon. O'Chucks

Researcher / Senior Writer at Profitable Venture Magazine Ltd
Solomon O’chucks is a Researcher, Prolific Writer and a UNICEF trained & certified Facilitator and Counselor, A Graduate of Morris Cerullor School of Ministry and He Holds a Degree in Personal Development & Science of Success from IIGL Asheville, NC, USA.
Solomon. O'Chucks

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